End Auckland's urban growth boundary - Twyford

Labour says removing Auckland's urban growth boundary will take some pressure off the high house and land prices.

It's one of a number of options the party has come up with and is urging the Government to rule the boundary out of Auckland Council's Unitary Plan if it wants to fix the housing crisis.

The boundary was first put in place to help stop urban sprawl, but Labour housing spokesman Phil Twyford says that hasn't worked.

"It has driven land and housing costs through the roof. It has contributed to a housing crisis that has allowed speculators to feast off the misery of Generation Rent, and forced thousands of families to live in cars, garages and campgrounds.

"Labour's plan will free up the restrictive land use rules that stop the city growing up and out. It will stop land prices skyrocketing, and put the kibosh on land bankers and speculators."

Mr Twyford says because the boundary is such a major contributor to the housing problem, it is "entirely appropriate" central government should have a say.

While planning decisions are typically left to local councils, Mr Twyford says housing affordability is of national interest.

The idea has already been backed by BusinessNZ, which says it is one of the key things that needs to change to help ease the housing problem.

Chief executive Kirk Hope says now that Labour and National agree on the issue of opening up more land, he hopes local government will "take heed of the need to focus on land and housing supply".

Mr Twyford says the limit drives up section costs by creating an artificial scarcity of land, which can lead to land inside the boundary being 10 times more valuable than rural land.

"It is not enough for the council to progressively add more land zoned for development here and there. That just feeds the speculation that is an inevitable result of having the boundary."

He believes "bold reform" is needed, which would free up growth on the fringes as well as allowing more density "so people can build flats and apartments in parts of the city where people want to live, particularly around town centres and transport routes".

Mr Twyford says the idea isn't the silver bullet, but "is one of the big ones".

Labour is also suggesting changes to the way infrastructure is financed.

"The cost of new infrastructure must rest with the property owners of new developments to prevent the ratepayer carrying the can for expensive infrastructure investment in places where it's too expensive to build," Mr Twyford says.

It is proposing to use bond financing paid back by targeted rates over the life of the asset, which can range up to 50 years.

He believes the Government must announce something substantial to deal with the problem in next week's Budget.

The Taxpayers' Union has launched an online petition for the Government to adopt Labour's plan.